# CLSS 2014 – Can Strike Off Application (Form FTE) be filed without filing pending documents under CLSS-2014?

Fast Track Exit guidelines of 2011 are still applicable. The general circular 36/2011 has neither been withdrawn nor suspended. Interestingly,  Section 560 of the Companies Act, 1956 relating to strike-off continues to remain applicable as corresponding Section 441 of Companies Act, 2013 has not been notified.

Informatively, the Company Law Settlement Scheme 2014 (CLSS 2014) provides that any defaulting company after filing documents under the Scheme can opt for strike-off by paying only 25% of the applicable fee. It allows companies to file e-Form FTE for striking off its name. It follows that FTE guidelines remain applicable.

Prior to CLSS 2014, the defunct companies (defaulting companies) were permitted to file e-Form FTE without having to file pending forms. The RoC’s were allowing the application on this basis. Many corporates willing to get their name struck off wish to file e-Form FTE straightaway without doing any filing under CLSS 2014 as it gives them financial benefit.

A question has been raised whether e-Form FTE can be filed by the defaulting/defunct companies without opting for CLSS 2014. The answer is Yes as the guidelines for FTE are still applicable and the same modus operandi has to be adopted by RoC’s. Legally, it is possible unless FTE guidelines are either withdrawn or suspended for the time CLSS is in operation. Till the time it is done by MCA, the companies would do well to file for strike-off.

Read all this and much more in my latest publication – Handbook on Company Law Settlement Scheme 2014 available at http://www.amazon.in or at http://tranzission.com/book1.html.

Ashish Makhija: ashish@ashishmakhija.com

Disclaimer: The views expressed here are views based on my personal interpretation and should not be deemed as legal or professional advise on the subject. If relied upon, the author does not take any responsibility for any liability or non-compliance.

#Wake-up MCA – Who gets Immunity for filing 23 B under CLSS 2014?

A new amnesty scheme – CLSS 2014 has been introduced by MCA. It is open until 15th October 2014.

The Scheme offers lower additional fee and also immunity from prosecution to the company and officers in default. This scheme is valid for filing of 8 forms – Form 20B, 21A, 23AC, 23ACA, 23AC-XBRL, 23ACA-XBRL, 23B and 66. These documents can be filed under the Scheme provided their due date was upto 30th June, 2014. CLSS 2014 is attractive particularly considering the benefits. The most important benefit it offers to directors is non-applicability of disqualification under section 164(2) for past defaults provided the defaults are made good by filing the documents under the Scheme.

Who gets Immunity for filing Form 23B?

Form 23B was to be filed by an auditor under the previous regime – Companies Act, 1956. Under the Companies Act, 2013, the responsibility of filing intimation of appointment of auditor has now shifted to the company and this intimation is to be in Form ADT-1. Form 23B was accordingly withdrawn effective 1st April, 2014.

Inclusion of this Form in the Scheme forced MCA to bring back this form on MCA portal for filing. There is no quarrel till this point.

The uncertainty relates to its filing and consequential immunity. The Scheme applies only to ‘defaulting companies’ and not to auditor. This raises a pertinent question that if the Scheme is not extended to auditors, how this form could be included in the Scheme.

Secondly, the immunity has to be applied by filing eForm CLSS and this form can only be filed by a company. This cannot be filed by the auditor.

Who gets Immunity under such a case?

Wake-up MCA and clarify this aspect!

Ashish Makhija: ashish@ashishmakhija.com

 Disclaimer: The views expressed here are views based on my personal interpretation and should not be deemed as legal or professional advise on the subject. If relied upon, the author does not take any responsibility for any liability or non-compliance.